On March 8, the Riverside County District Attorney announced that four men had been arrested in connection with an $8 million health care fraud scheme. The men were Jeffrey D. Ogletree, of Meridian, Idaho; Brian Andrew La Porte, of Poway, California; Dennis Davin Bonavilla, of Murrierta, California; and Babar Iqbal, of Irvine, California, who was also the owner of Riverside Regional Surgery Center. The men were allegedly involved in a scheme to provide fake health insurance to patients in the Midwest.
Fake Health Insurance Scheme
In 2013, La Porte formed Free Choice Healthcare Foundation (FCHF), which allegedly was created to help low-income individuals pay health insurance premiums. The foundation was never registered as a charity in California. After meeting with Ogletree, a vice president of a hospital group in the Midwest, the hospital donated more than $5 million to FCHF in 2015. The donation was purported to be used to provide year-long health insurance for 333 residents in the Midwest.
However, policies were not actually purchased for many of those individuals, and in situations in which a policy was purchased, the premiums were not paid. Instead, the $5 million was distributed to the defendants and limited liability companies owned by some of the defendants for their own personal gain. Ogletree received a $1 million kickback for the donation, which he used to purchase a home.
Additionally, Iqbal and two others allegedly worked together to provide health care for fake employees of shell companies set up by one of the defendants. La Pore and Bonavilla purchased employer group health plans from United Healthcare for two of their businesses, Drexel Group LLC and Kingmakers LLC. Within five weeks of the policies being issued, 22 Kingmakers employees were treated by Iqbal, who the received more than $1 million of reimbursements on those claims. These individuals, who were not actually employees of Kingmakers, had Medi-Cal. However, Iqbal told them Medi-Cal would not cover their treatment and had the individuals sign papers to obtain free health insurance.
Ultimately, the defendants allegedly received $5 million through donations made under false pretenses. They also made $3 million in illegal kickbacks.
Scheme Leads to Many Criminal Charges
The district attorney’s office filed a 33-count complaint, which included charges for health care fraud, conspiracy, grand theft, identity theft, money laundering, and tax evasion. For many of these offenses, the defendants can be penalized with up to five years in prison and significant fines for each count. However, some of the offenses, such as money laundering, can result in imprisonment up to 10 or 20 years for each count. Depending how many counts each defendant is found guilty of, they could face decades in prison and hundreds of thousands of dollars in fines. They may also be required to give back all or a significant portion of money they unlawfully obtained through fraudulent insurance claims.
Do You Have Information About a Health Care Scheme?
If you are aware of a physician or health care professional conducting a health care scheme, whether it involves receiving kickbacks or making false claims to private insurers or government health programs, you need to speak with an attorney at Brod Law Firm. Your information may be pertinent to state and federal law enforcement authorities. Or, it may provide you a basis for filing a False Claim Act suit on behalf of the government, which is known as a qui tam suit.
To discuss your rights and options as a whistleblower, call (800) 427-7020 to schedule a free consultation.
(image courtesy of Vladimir Kudinov)